Business Case

Introduction

The prospect of developing a SBusiness Case can be daunting. The structure and approach described here can be used and adapted as necessary to ensure that the case is robust and offers the best chance of success.

Developing a robust Business Case will help to clarify the current position and determine what is required to improve existing services or develop a new one.

A Business Case template and costing model has been provided that can be tailored and can be used to secure approval, particularly where additional investment is required, and provides information to demonstrate a clear rationale, the benefits to patients, the service and the Trust, financial effectiveness and affordability.

This template reflects the findings from our implementation sites and outlines the main chapter headings and areas to consider when constructing a Business Case for the Seldinger Suprapubic Catheter Kit. The level of detail required will depend on the scale and complexity of the proposal, the approvals route and the intended audience.

As a minimum it should provide a concise and robust case to persuade someone who is unfamiliar with the service that investment is justified. In addition, some Trusts have standard templates or report formats, which will also determine how information should be presented.

Seldinger SPC Cost Savings Model

A major objective of implementing the Seldinger SPC kit was to improve safety and reduce the requirements for a general anaesthetic and associated hospital stay. To achieve this there is a need to evaluate current and projected service requirements to calculate the effects of using the new technique on physical and financial resources.

A Cost Savings Model has been developed by the NHS Technology Adoption Centre with the support of the NHS Purchasing and Supply Agency (PASA) to assist managers and clinicians to calculate the potential impact of introducing the new Seldinger SPC technique on:

  • Bed days
  • Theatre Sessions
  • PBR (Payment By Results) Income

The cost savings model can be easily customised to take account of local factors such as length of stay, bed day costs and tariff, for example.

Note: Download a local copy of the Cost Savings Model from the resources on the left-hand-side of the screen. Please enable macro's to make full use of the Cost Savings Model tool. This tool currently runs from the Website when using Internet Explorer 7 - users who have earlier versions of Internet Explorer should download a local copy of the file.

Business Case Format

Strategic context

This section sets the scene for the case for change and demonstrates how the proposal fits with and contributes to achieving relevant national and local NHS policy and priorities, as well as relevant research and professional body reports/guidance. It is critically important to provide evidence on how the current service and proposal is aligned with the Trust's short and long-term strategic plans and objectives for the coming year. If it is inconsistent or a poor fit it may be wise to question whether to proceed.

Case for change

A significant element of the case is to provide an overview of the key pressures driving the case for change. Tools that are widely used to establish a clear understanding of the current service, what may be required in the future and indicate potential options are PEST and SWOT analyses.

Using these techniques it will be possible to distil the key drivers for change and highlight the consequences of doing nothing.

Objectives

Establish a clear set of objectives that will be used to judge the success of the investment.

Future service requirements

Future service requirements can be determined through service redesign, activity, performance and capacity modeling.

The potential for improvement through service redesign should be examined such as changing working practices, improving patient pathways and consideration given to whether services could be delivered in the outpatient setting.

The first step in activity modeling is to establish an accurate baseline by identifying activity by Health Resource Group (HRG) and attendance by point of delivery (elective, non-elective, day case, outpatient, new or follow-up attendance).

Current performance in terms of average length of stay, day case rates and a description of current facilities should be included.

The timeframe re-modeling services should be developed . When projecting activity both demand and capacity factors need to be taken into account.

The extent to which greater clinical efficiency can improve performance should then be factored in. Current performance should be benchmarked.

Ensure that assumptions regarding performance improvement are consistent with those included in the Trust Business Plan or other short-term strategic plans.

The capacity required (number of inpatient beds, day case trolleys/chairs, theatre sessions, outpatient sessions etc) to support the future service are derived from the service model, activity modeling and projected performance improvements.

Options appraisal

Options appraisal is an objective way of comparing the costs and benefits of different options. There are four main stages; developing options, scoring the non-financial benefits, identifying the capital and revenue implications and finally identifying the preferred option.

Additional income should be calculated from the activity forecasts. NHS activity by HRG or attendance is multiplied by the relevant national tariff and where appropriate take account of the estimated contribution to corporate services to give a net income figure.

The final step is to select a preferred option by weighing up the relative benefits and costs of each option. The preferred option is likely to be the option that offers the most benefits for the least cost.

Affordability

Demonstrating that the case is affordable will be critical to its success. Affordability analysis examines the price impact of the development taking account of the revenue funding available and existing commitments.

Additional income is compared with additional revenue costs to determine affordability. If there is a mismatch between income and costs it will be necessary to reduce the scope of the case, expand the timeframe or consider whether additional funding can be sought from other sources.

Timescale and deliverability

Outline a realistic timeline and implementation plan indicating the main phases and tasks of the project, including completion dates and individuals responsible.

Risk analysis and management

A risk management strategy will help to gain an understanding of the uncertainties and unwanted consequences of the proposal. Identifying the main risks, evaluating their impact should the risk occur, and outlining the actions necessary to mitigate against them will improve the likelihood of the project's success.

Writing up

A Business Case should be a clear and concise document containing section headings, sub-headings and numbered paragraphs to enable the reader to pin point specific text. Detailed supporting information should be relegated to the appendix. Avoid jargon and highly technical language and provide a clear explanation or glossary for clinical or professional terminology.

Fitness for Purpose Checklist

Consideration of the following questions can act as a quick checklist to ensure that the proposal is worth doing and achievable:

  • Is the need clearly stated?
  • Does the proposal contribute to the achievement of NHS policy and priorities and Trust objectives and plans?
  • Are the benefits clearly stated?
  • Is it clear how the benefits will be realised?
  • Are the demand and capacity and income forecasts robust?
  • Are the capital and revenue costs robust?
  • Is it clear why the preferred option has been selected?
  • Is it affordable?
  • Are the risks and plans to mitigate against them explicitly stated?
  • Do the main stakeholders support it?
  • Does the team have the capacity and capability to deliver it?

Approval

The scale and nature of your proposal will determine the route of approval. If it is affordable within the Directorate budget the General Manager may be prepared to agree the proposal.

However, larger, more complex cases that require capital or revenue investment are likely to need Executive level approval. Meeting dates and deadlines for papers can then be used to determine the process and timescale for developing the Business Case.

Resources

The complexity of the case will determine who will need to be involved, support from the line manager is essential and help from information analysts, finance, estates and planning staff may be required.

Additional Resources

References

  1. NHS Executive. Capital Investment Manual. London: HMSO; 1994
  2. HM Treasury. The Green Book: Appraisal and Evaluation in Central Government. London: HMSO; 2003.
  3. Stevenson VL, Jarrett L, editors. Spasticity Management: A Practical Multidisciplinary Guide. London: Informa Healthcare; 2006.

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